Net Neutrality Proj.docx

NET NEUTRALITY A REVIEW

Rishab Lohan 1647, LL.M., UILS

CONTENTS INTRODUCTION ..................................................................................................................... 2 FREEDOM OF COMMUNICATION ...................................................................................... 4 WHAT IS NET NEUTRALITY ................................................................................................ 6 DEBATE ON NET NEUTRALITY .......................................................................................... 8 PRACTICES AGAINST NET NEUTRALITY ........................................................................ 9 NET NEUTRALITY – INTERNATIONAL SCENARIO ...................................................... 10 NETWORK NEUTRALITY IN THE UNITED STATES .................................................. 11 NETWORK NEUTRALITY IN EUROPE .......................................................................... 14 NET NEUTRALITY IN INDIA .............................................................................................. 17 NET NEUTRALITY'S INTERSECTION WITH COMPETITION LAWS ....................... 19 CONCLUSION ........................................................................................................................ 22 BIBLIOGRAPHY .................................................................................................................... 24

INTRODUCTION The Internet is a global, interconnected network of computers that allows data transfers and provides a variety of interactive, real-time and time-delayed telecommunications services. Internet communications are based on common, public protocols. Hundreds of millions of computers are connected to the Internet at any moment. The vast majority of computers connect to the Internet through commercial Internet Service Providers (“ISP”s). Users connect to the Internet through ISP dial-ups, cable modems connections, residential Digital Subscriber Lines (“DSL”), or through corporate networks (Local Area Networks (“LAN”s)). Ninety-eight percent of domestic residential broadband customers access the Internet through DSL or a cable modem.1 Only about half of residential consumers have a choice between even two providers. Typically, the routers and switches owned by the ISP send the caller’s packets to a local Point of Presence (“POP”) on the Internet. In dial-up, cable modem, and DSL, the access POPs, as well as corporate networks dedicated access circuits, connect to high-speed hubs. Generally, access POPs (which serve dial-up, cable modem and DSL connections) and corporate networks with dedicated access circuits connect to high-speed hubs. Highspeed circuits, leased from or owned by telephone companies, connect the high-speed hubs, forming an Internet Backbone Network (“IBN”). The Internet has transformed the world and society like never before. It has provided a platform for new opportunities through innovation. Internet has fostered the supremacy of ideas rather than capital. It is a universal platform that uses the same standards in every country, so that every user can connect to every other user with physical distances becoming irrelevant in the networked world. The Internet is a public resource that has no ownership, but is available to all those who are digitally connected. The Internet is the primary global network for digital communications. A number of different services are provided on the Internet, including, among numerous others, e-mail servers, browser interfaces (using Internet Explorer, Firefox, Opera, or others), Peerto-Peer file exchange services, and Internet telephony (Voice over Internet Protocol (“VOIP”)). A number of software applications run on top of the Internet browser, including information services (Google, Yahoo, MSN), image displays, video transmissions and others. Since the advent of Committee on Commerce, Science, and Transportation, Hearing on “Network Neutrality” (testimony of Vinton G. Cerf ), 109th Cong., 1st sess., 2006, http://commerce.senate.gov/pdf/cerf-020706.pdf (accessed on February 13, 2017). 1

Mosaic, the first Internet browser, in 1993, the Internet has evolved beyond text-based interface to support images, sound, and video transmitted in digital format. Even full length movies are regularly downloaded, rented, or sold through commercial services over the Internet and viewed on personal computers or television sets. India has demonstrated to the world its capacity to develop innovative business models in affordable mobile telephony suited to the requirements of a developing country. It has 997 million2 telecom subscribers and 99.20 million broadband subscribers with an access to internet at speeds higher than 512 kbps. Out of about 300 million3 subscribers accessing the internet, around 93% subscribers are on wireless media, whereas 7% are on fixed wire line media. Currently, both broadband and internet penetration in India is comparatively low in the global context.

2 3

The Indian Telecom Services Performance Indicators, October – December, 2015; TRAI report Jan 2015 IAMAI Report

FREEDOM OF COMMUNICATION The Internet is a global, interconnected and decentralised autonomous computer network. We can access the Internet via connections provided by Internet access providers. These access providers transmit the information that we send over the Internet in so-called data “packets”. The way in which data is sent and received on the Internet can be compared to sending the pages of a book by post in lots of different envelopes.4 The post office can send the pages by different routes and, when they are received, the envelopes can be removed and the pages put back together in the right order. When we connect to the Internet, each one of us becomes an endpoint in this global network, with the freedom to connect to any other endpoint, whether this is another person’s computer (“peer-to-peer”), a website, an e-mail system, a video stream or whatever. The success of the Internet is based on two simple but crucial components of its architecture: 1. Every connected device can connect to every other connected device. 2. All services use the “Internet Protocol,” which is sufficiently flexible and simple to carry all types of content (video, e-mail, messaging etc) unlike networks that are designed for just one purpose, such as the voice telephony system. Internet access providers enable us to communicate, browse the web or transfer files over the Internet, to make our own websites globally available and to use services such as email, social media or Internet telephony. Everybody, and in whatever role, and all organisations, of whatever size and style, is able to participate globally. Everybody is able to access services and to offer services. In India, Internet traffic is likely to increase manifold in the next few years. There is a constant pressure for investment in network infrastructure and to expand capacities and increase penetration. Telecom infrastructure, being a capital intensive industry, will require significant investments by operators to meet the network capacity demands brought about by increasing broadband penetration, increasing speeds and increasing data usage. Telecom service providers have also started facing competition from unlicensed application platforms, termed Over-the-Top (OTT) players, in their traditional voice communication field.

4

EDRi booklet: How the Internet works http://www.edri.org/files/2012EDRiPapers/how_the_ internet_works.pdf

With an objective of enhancing revenue streams and to face competition from OTT players, telecom service providers have been exploring new opportunities for generating revenues from users and the content providers. Some of the models attempted by TSPs, such as charging higher data tariffs for VoIP services, charging content application providers and providing the content free to users (called “zero rating” plans), have raised concerns about Net Neutrality. This phenomenon is not unique to India but has been witnessed across the world.5

5

Net neutrality debate in India, http://www.legallyindia.com/blogs/the-net-neutrality-debate-in-india.

WHAT IS NET NEUTRALITY Net Neutrality is most commonly defined as the principle that Internet users can connect to any other point in the network. Users can create, access and use any content, service and application they choose, without discrimination, restriction or limitation imposed by those who run the infrastructure. Open and non-discriminatory access to the Internet has revolutionized the way people communicate and collaborate, entrepreneurs and corporations conduct business, and governments and citizens interact. This has led to rapid growth in people-to-people, businessto-people and government-topeople communications shaping new forms of social interactions, businesses and governance. There is no standard definition of Net Neutrality. Net Neutrality is globally understood as a network principle of equal treatment of data packets moving across the IP networks. The concept has been used more broadly to describe the open and non-discriminatory access to the Internet.6 The debate began in the late 1990s in the United States and has since gained momentum in academia, civil society, the technical community and the private sector linked to Internet and telecommunications. Since then, it has been gaining momentum in several fields, generating dichotomous positions between different sectors. Telecommunications networks and services and providers of content over the Net uphold the digital ecosystem, and it is essential that both can develop sustainably, with equivalent regulations and principles. This raises two important thoughts. First, it is important to promote investment, innovation and competition, preventing distortions through the relationships produced within the digital ecosystem. Second, the regulatory principles should be balanced between the different actors of the value chain. Meeting certain basic principles in favour of competition and against arbitrary discrimination would create the conditions for fostering the development of the digital ecosystem.

6

NET NEUTRALITY DoT Committee Report, available at accessed on February 13, 2017.

Net neutrality means Internet that allows everyone to communicate freely. It means a service provider should allow access to all content and applications regardless of the source and no websites or pages should be blocked, as long as they aren‘t illegal. It‘s like a fixedtelephone line, which is equal to all, and no one gets to decide who you call or what you speak. Another aspect of net neutrality is level playing field on the internet. This means, all websites can co-exist without hampering others. All websites are accessible at the same speed and no particular website of application is favoured. For instance – like electricity, common for all. Net neutrality also means all web sites and content creators are treated equal, and you don‘t have to pay extra for faster Internet speed to a particular site/service.7

Leela Krishna Ganapavarapu. Net Neutrality in India – Problems and Prospects. International Journal of Science and Research. accessed on February 13, 2017 7

DEBATE ON NET NEUTRALITY On the Net Neutrality continuum, there are two views on the opposite sides of the scale. On one side of the scale, the view held is that every user must have equal access, via the internet and, more generally, electronic communications networks (regardless of distribution platform) to all of the content, services and applications carried over these networks, regardless of who is supplying or using them, and in a transparent and nondiscriminatory fashion. Putting this view into practice comes up against a variety of constraints, such as having to protect the networks from attacks, and from problems of traffic, the need to install mechanisms to comply with legal obligations, maintaining acceptable level of Quality of Services for some real time services etc. Therefore, the network has to be managed with traffic management tools. The traffic management practices adopted may or may not be acceptable from the Net Neutrality point of view. There are other considerations as well. Unlike an infinite resource, the bandwidth of the Net is limited. There are users who require a whole lot more bandwidth than, say, someone sending emails. If someone is using Skype or YouTube, he needs a lot of bandwidth and that too on priority without any significant delay, otherwise the service quality suffers. It can be argued that he should pay a higher price because he is using more space and his traffic needs to be sent on priority. But Net Neutrality proponents say that neither he should be given priority, nor he should be charged higher and his traffic should also be treated in the same way as others on best effort basis Moreover, all data packets are not created equal. Data packets of different applications (e.g. an email packet and a VoIP packet, a data packet carrying emergency service information versus another packet carrying video information etc.) have different characteristics and they need different type of treatment on the network for a variety of reasons. The concept of “One size fits all” does not work and networks are inherently designed to differentiate between different types of data packets so that they can be treated differently. Therefore, the puritan view of Net Neutrality has practical limitations and it does not work in the real world. In a pure world of data, there will be differentiation between data packets for one reason or the other, technology also permits this and therefore exceptions will have to be made within the overall principles of Net Neutrality.

PRACTICES AGAINST NET NEUTRALITY8 

Blocking access to specific content, applications and services. Such practice may be put in place in order to comply with national legislation, may be used for security purposes e.g . blocking ports to prevent spam or other harmful traffic, but may be also implemented to inhibit competing services. To this latter extent, some network operators have been inhibiting protocols exploited by competing services, such as VoIP, in order to preserve their business model. Blocking practices prevent communications without inspecting data packets, whereas filtering techniques imply that the content of communications must be inspected before being blocked.



Filtering specific data packets. This practice aims at granularly analysing Internet traffic to identify specific content and apply a particular treatment, such as blocking, throttling or prioritisation. Hence, this technique requires installing content inspection equipment so that Internet traffic is analysed when passing through the filtering equipment. This technique can be used to preserve network security and integrity, for instance filtering out spam or limiting the effect of malicious attacks, but may also be used for censorship purposes and has the potential to jeopardise the privacy of end-users’ communications.



Bandwidth throttling. In this case, the operator downgrades specific type of Internet traffic ( e.g . all video traffic) or specific bandwidth-greedy applications ( e.g. peer-to-peer) in order to limit the congestion they generate. However, bandwidth throttling may be also exploited to reduce the quality of competing applications. Such technique may be applied temporary and exceptionally but can be also applied on a general basis, to discriminate against a specific type of traffic or applications, despite the existence of congestion.



Traffic prioritisation. Differently from bandwidth throttling, this kind of technique gives, preferential treatment to specific types of traffic e.g. by prioritising time- sensitive applications, such as VoIP, or to guarantee quality of service of specific services. This latter case may happen when operators implement pay for-priority schemes, allowing specific CAPs to purchase preferential treatment, or when operators deploy specialised services (such as e-health services) with no separation from Internet access services. It is important to note that the quality of the non-prioritised applications—or of the general Internet access service, in case of non-separated specialised services—may be degraded, due to sharing resources.

8

Pablo Bello. Net Neutralitywww.ourinternet.org/sites/default/files/publications/no13.pdf

NET NEUTRALITY – INTERNATIONAL SCENARIO Only a few countries have taken a firm position on the issue, and in a few other countries the issues surrounding Net Neutrality were being deliberated. Net Neutrality is a complex issue and has different nuances specific to a country depending on its social, political and economic conditions. Accordingly, each country adopts different responses to the issue. On the basis of measures undertaken on Net-Neutrality, nations can be divided in the following three categories: a) Countries which have taken no specific measures as the existing mechanism is often considered sufficient to address the issue e.g. Australia, Republic of Korea, New Zealand. b) Countries that have adopted light-touch regulatory measures through transparency, lowering switching barriers, minimum Quality of Service (QoS) requirements etc. e.g. European Commission, Japan, United Kingdom. c) Countries that have taken or propose to take specific legislative measures to enforce Net Neutrality principles (no blocking, no discrimination in treatment of traffic etc), subject to reasonable traffic management and other exemptions. e.g. Brazil, Chile, France, Netherlands, Singapore, USA (FCC rules) Chile was the first nation to enact Net Neutrality principles into law in July 2010. The main legal principles laid down are that: (i) ISPs may not arbitrarily block, interfere with, discriminate against, hinder or restrict the right of any Internet user to use, send, receive or offer any legal content, application or service on the Internet, or any kind of legal Internet activity or use; (ii) ISPs may undertake traffic management and network administration that does not affect fair competition; (iii) ISPs shall protect the privacy of the users; (iv) the users are free to add or use any kind of instrument, device or equipment on the network, provided they are legal and do not harm or adversely affect the network or quality of the service (vi) ISPs shall ensure transparency by publishing details of Internet access offered, its speed and the quality of the connection, making a distinction between national and international connections, and shall include information about the nature and guarantees of the service.9 Norwegian Post and Telecommunications Authority (NPT) published “Guidelines for InterNet Neutrality” in February, 2009, after consultations with major stakeholders. The 9

DOT Committee https://www.mygov.in/sites/default/files/master_image/Net_Neutrality_Committee_report.pdf

report,

guidelines define three principles, namely: (i) Internet users are entitled to an Internet connection with a predefined capacity and quality; (ii) Internet users are free to send and receive content of their choice, use services and run applications of their choice, connect hardware and use software of their choice that does not harm the network; (iii) Internet users are entitled to an Internet connection that is free of discrimination with regard to type of application, service or content or based on sender or receiver address; (iv) Traffic management on an operator’s own network to block activities that harm the network, comply with orders from the authorities, ensure the quality of service for specific applications that require it, deal with special situations of temporary network issues. South Korea is the most wired country in the world with the largest optical fibre penetration and the highest internet speeds. The country has not officially adopted any legally binding decision on Net Neutrality but has published “Guidelines for Network Neutrality and Internet Traffic Management”, which includes the right to use lawful content, application, service, and non harmful devices or equipment freely. UK follows a light-touch regulatory approach. OFCOM has not imposed strict restrictions on traffic management, but instead relies on existing regulation and market structures. ISPs follow a voluntary code of practice which was developed by stakeholders. However, few of the major ISPs have refused to sign the Open Internet Code of Practice. Brazil has recently passed a legislation known as the Marco Civil da Internet (The Civil Internet Regulatory Framework) in April 2014 which gives legal backing to enforcement of Net Neutrality principles.

Network neutrality in the United States10 Although the controversy over network neutrality can trace its roots to disputes over open access to cable modem systems that took place during the late 1990s, the debate began in earnest in 2002, when the FCC issued a ruling to classify cable modem systems as ‘information services’ instead of ‘telecommunications services’, which exempted them from Title II regulation, including, inter alia, network-sharing obligations (FCC, 2002).11 The US Supreme Court eventually upheld the FCC’s action in Brand X Internet Services v. FCC (2005).

10

Andrea Renda. Telecommunications and Internet Services: The digital side of the TTIP https://www.ceps.eu/system/files/SR112%20Renda%20and%20Yoo%20Telecoms%20TTIP.pdf 11 Just the FCC concluded that broadband was an information service did not necessarily mean it would not be regulated. With respect to both DSL and cable modem service, the FCC sought comment on what regulations, if any, the FCC should impose under its general rulemaking authority (FCC, 2002a, pp. 3040-3048; 2002b, pp. 4839-4854).

In response to concerns raised in the aftermath of this ruling, then-FCC Chairman Michael Powell (2004) called upon the industry to voluntarily embrace a series of Internet freedoms that would ensure end users’ ability to access content, run applications and attach personal devices as they saw fit, subject only to restrictions needed to manage networks, ensure quality experiences, prevent disruption of the network and prevent theft of service. Powell also called for the industry to provide consumers with clear and meaningful information regarding the terms of their broadband service plans. Concerns about blocking were heightened when a small local telephone company known as Madison River Communications prevented its DSL (digital subscriber line) customers from using the ports needed to access Internet telephony (also known as Voice over Internet protocol or VoIP) The FCC (2005a) invoked Title II when approving a consent decree settling this matter. The FCC (2005b) reversed course after the US Supreme Court’s decision in Brand X, classifying DSL and other wireline forms of broadband Internet access constituted an information service. Shortly thereafter, the FCC also classified broadband over powerline and wireless broadband as information services as well (FCC, 2006 and 2007). Since then, the FCC has constantly been under pressure to strengthen network neutrality rules. For example, at the same time that the FCC classified DSL as an information service, it issued a Policy Statement recognising the agency’s intent to preserve consumers’ rights to access content, run applications and attach devices as they saw fit. As such, the rule prohibited the blocking of content, but did not explicitly prohibit non-discrimination and even acknowledged the need for exceptions to the no-blocking principle for the needs of law enforcement and for “reasonable network management” (FCC, 2005c). But the Policy Statement did not formally adopt any regulatory mandates, and network neutrality proponents began to regard nonblocking obligations as insufficient. Also the US Congress began to debate the issue during its consideration of major telecommunications reform legislation in 2006. Although attempts to introduce network neutrality into the legislation were rejected by wide margins in the House of Representatives, the issue proved more controversial in the Senate, where an evenly divided Commerce Committee rejected a network neutrality amendment by a vote of 11 to 11. The underlying bill was never brought to the floor of the Senate. During the Obama Administration, calls for stronger network neutrality have become even more frequent.12 After taking office, the Obama Administration included provisions in 12

Barack Obama endorsed network neutrality both as a Senator and a candidate during the 2008 presidential campaign (http://change.gov/agenda/technology_agenda/)

the stimulus package that required that that broadband infrastructure grants made by the National Telecommunications and Information Administration comply with the 2005 policy statement on network neutrality (American Recovery and Reinvestment Act of 2009). This new momentum led the FCC to issue a notice of proposed rule-making recommending the adoption of formal network neutrality rules for the first time in 2009: the proposed rule also included provisions on non-discrimination, while maintaining exceptions for reasonable network management and law enforcement/public safety and applying a lower standard to wireless networks. At that time, the FCC decided against reclassifying broadband as a Title II telecommunications service. Although the FCC’s first Open Internet Order was adopted at the end of 2010, it was not published in the Federal Register until 23 September 2011. Shortly thereafter, Verizon challenged the 2010 order in court, with the court resolving the matter in January 2014 (Verizon v. FCC 2014). The court ruled that the FCC has ancillary authority over the broadband Internet as a general matter, but struck down the FCC’s non-discrimination and non-blocking rules as improper exercises of that authority, while providing guidance on how to reframe those rules so that they would comply with the statute. In May 2014, four months after the court’s opinion in Verizon v. FCC, the agency proposed new rules that followed the approach described by the court (FCC, 2014a). But while the FCC seemed to favour a compromise solution in which non-blocking rules would be coupled with exceptions for specialised services and reasonable traffic management, the political landscape changed abruptly in November 2014, when the President endorsed Title II as the basis for network neutrality in a public speech. This speech heavily influenced the content of the new Open Internet Order adopted by the FCC on 26 February 2015, and released on 12 March 2015. The new Open Internet Order reclassified broadband Internet access services (BIAS) as a telecommunications service governed by Title II of the Communications Act of 1934, completing what can only be seen as a U-turn from the direction the FCC had taken since 2002.13 The Order establishes three ‘bright-line rules’ prohibiting blocking, throttling and paid prioritisation, with all other conduct being governed by a general standard prohibiting unreasonably interfering with disadvantaging consumers’ ability to reach the content, applications, services or devices of their choice or edge providers’ ability to access consumers

13

2 The FCC has also stated it will refrain from applying as many as 27 provisions of Title II, and as many as 700 codified rules, resulting in what the Commission calls a “light-touch” approach for the use of Title II” See FCC (2015, p. 12)

using the Internet. The order created exceptions for reasonable network management, defined as practices primarily used for and tailored to achieving a legitimate network management purpose as opposed to a business purpose. Another new feature of the Order is that it extends full network neutrality protection to wireless networks. With respect to specialised services, which the order renamed non-Broadband Internet Access Services (non-BIAS) data services, the FCC continued to permit providers to offer these services while continuing to monitor their development and use. But perhaps the biggest change in the scope of the order is the inclusion of interconnection in its regulatory purview. Until the adoption of the 2015 order, network neutrality sought to equalise how traffic is handled within a broadband network. Regulating interconnection, in contrast, seeks to equalise the terms under which how traffic arrives at a network. What is most striking is the extent to which network neutrality has represented a moving target. What began in 2005 as a prohibition on blocking also became in 2010 a prohibition on discrimination and in 2015 direct regulation of interconnection as well. At the same time, the jurisdictional foundation for network neutrality has shifted from the general, more flexible provisions of Title I to the more intrusive framework of Title II. What will happen next is anyone’s guess, since (as occurred in 2010 after the adoption of the first Open Internet Order) network providers have brought a judicial challenge to reclassification of broadband as a Title II service.

Network neutrality in Europe Back in 2005, when the Madison River case was intensifying the network neutrality debate in the US, the European Commission was deeply convinced that the debate would never gain traction in Europe. Ten years later, it is clear that these early predictions were wrong: since 2009, Europe has been trapped in a fierce discussion, which – as will be clarified at the end of this section – seems to have been recently affected also by the resurgence of protectionism and industrial policy at the EU and at the national level and is likely to reach new policy areas, such as platform neutrality and search neutrality. The first EU rules on network neutrality were adopted in 2009 and included in Articles 20 and 22 of the then-amended Universal Service Obligations (USO) Directive. Article 20 of the USO Directive mandates that network operators that manage traffic should inform end users in a transparent way of the practices they adopt so that users can make an informed choice when deciding whether to subscribe. Article 22 of the USO Directive introduced the possibility

for national regulators to intervene and impose a minimum quality-of-service level in case the quality of certain applications became unacceptable for end users, arguably due to traffic management practices. Despite difficulties faced by national regulators in applying this rule, in late 2013 the ‘Connected Continent’ proposal presented by the European Commission contained a very similar approach. On the one hand, the proposed package recognised that network neutrality is what keeps the Internet open and as such should be the default principle for all ISPs (Internet service providers) in the EU-28. On the other hand, the proposed rule left the door open to the creation of specialised services through agreements between ISPs and application/content providers, under the condition that such services do not disrupt the open Internet. However, in April 2014, the proposal was significantly modified by the European Parliament, which basically rejected the possibility of specialised services and reinstated network neutrality as an almost insuperable principle for ISPs. The text of the Connected Continent package is currently undertrilogue (negotiations between the European Commission, the European Parliament, and the Council), but a political agreement was announced by the European Commission on 30 June 2015. Under the new agreement, the principle of net neutrality will for the first time be enshrined into EU law: users will be free to access the content of their choice, they will not be unfairly blocked or slowed down anymore and paid prioritisation will not be allowed. In parallel, Internet access providers will still be able to offer specialised services of higher quality, such as Internet TV and new innovative applications, so long as these services are not supplied at the expense of the quality of the open Internet. These rules will be a reality across all member states as soon as the text officially applies on 30 April 2016. 14Accordingly, the final compromise is closer to the original position of the European Commission and, as such, contemplates the possibility of specialised services and reasonable traffic management. More specifically, the Commission explains that “all traffic will be treated equally, subject to strict and clearly identified publicinterest exceptions, such as network security or combating child pornography, and subject to efficient day-to-day network management by Internet service providers”. In summary, the EU position on network neutrality is likely to remain controversial in the coming years: despite the recent political agreement, which will take effect in April 2016,

14

http://europa.eu/rapid/press-release_IP-15-5265_en.htm.

implementation issues are still far from settled. 15 Meanwhile, a number of member states have taken the initiative to regulate the issue, leading to remarkable inconsistencies across the EU. While countries like the Netherlands, Finland and Slovenia have enacted very strict neutrality rules, France has explicitly allowed traffic management practices, and the United Kingdom regards the possibility to charge quality of service fees as a much-needed opportunity for ISPs to monetise their investments in broadband networks.

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Renda (2013) on the lack of detail on the implementation of a rule based on the co-existence of best effort Internet and specialised services.

NET NEUTRALITY IN INDIA Taking the recent events into account, its time net neutrality is imposed in India too. Since the past couple of years, the instances of Internet censorship in India have increased manifold. In 2011, India adopted the new IT Rules 2011 that supplemented the IT Act 2000. These rules made it mandatory for Internet intermediaries to remove objectionable content within 36 hours of receiving complaint. But the terms included were vague and open to interpretations. These rules received sharp criticism, but they have prevailed. In 2011, government also drew flak as it asked major sites like Google, Facebook and Yahoo to pre-screen‘ content and remove any objectionable, defamatory content from going live. Government requests for banning content has also been on rise over the past couple of years. On the other hand, with the increasing popularity of instant messaging apps like WhatsApp, Viber and others, telcos had started making noise against the accelerated adoption of these services. Throughout last year, they‘ve have been quite vocal about their dislike for over-the-top (OTT) services, who have been cannibalizing their main revenue streams – calls and SMSes. There was buzz around a fee being imposed on popular OTT services, but the matter fizzled out soon after TRAI rejected telcos proposal to do so. In a bid to make up for the losing revenue, Airtel decided to play evil Santa on Christmas 2014 and announced an extra charge on making VoIP calls. The Twitterati had gone all out condeming Airtel for the act, and the service provider had to soon retract its decision. Net neutrality got yet another blow in India with the recent announcements from Reliance and Airtel. In India, Facebook has teamed up with Reliance Communications in an effort to bring Internet.org to smartphone as well as feature phone users. But at the Mobile World Congress, telecom service providers such as Vodafone, Airtel and Telenor have made their discomfort clear when it comes to offering free Internet services over expensive telecom networks. In order to compete with Reliance, Airtel announced Zero marketing platform allowing customers to access apps of participating app developers at zero data charges. Now, you may be wondering what is wrong if someone wants to offer free Internet? Free internet sounds tempting, but you need to be aware that you are only getting free access to services/apps which have struck a deal with the telcos. App developers and services flush with funds will not find it an issue to pay telcos for data charges. But this can leave app

developers, specially start ups, who cannot afford Airtel or Reliance‘s data rates at a definite disadvantage. In India, the concept of net neutrality doesn‘t exist legally. However, ISPs try to moderately not violate any laws. They‘ve approached Trai for the losing revenues and are awaiting TRAI’s decision on regulation IM app by OTT players. Most decisions here are made by DoT and TRAI. However, it would be a good move to get things legally on paper, while Internet access in India is still at its infancy. The Internet from the very beginning signified interconnectedness sharing information and providing a platform for fostering innovation. Internet has functioned on the ―end-to-end principle‖ characterised by dumb networks carrying information to smart terminals. Internet has been a medium that has created innovation in technology, business and governance. Internet has thrown up several challenges for public policy but it should not lead to restrictions both on network creators or network users that unnecessarily and unjustifiably stifle experimentation and further innovation in technologies and business models either in telecom networks or the larger economic world. The open, democratic nature of the Internet has kept information and content accessible by the user largely unrestricted. There is a view that diluting neutrality of the Open Internet may compromise the independence and diversity of information. With the explosive growth of social media and the use of Internet as a platform for expression of thoughts and opinions, it has been argued that the equal access to Internet is integrally linked to freedom of expression. The question as to whether the carrier (ISP/TSP) should have the ability to choose the content that gets delivered to the user, and affect the basic architecture of the internet, has formed a significant argument in favour of Net Neutrality. The majority view is that only the user should have the unbridled right to access the lawful contents on the Internet without the carrier having the ability to discriminate – either through price, speed or quality - content available on the Internet. Some proponents of Net Neutrality while accepting the need for traffic management have argued that disclosure of practices (voluntary or mandated) adopted for traffic management by carriers should be supplemented by a right of the user to seek additional information from them with an objective to secure Net Neutrality. Currently, there are no laws enforcing net neutrality in India. Although TRAI guidelines for the Unified Access Service license promote net neutrality, it does not enforce it. The

Information Technology Act 2000 also does not prohibit companies from throttling their service in accordance with their business interests.

Net neutrality's Intersection with competition laws16 Several opponents have recommended antitrust/competition laws as a tool to assess deviations from net neutrality. They argue that the conduct banned by net neutrality is often in the nature of vertical agreements, which could have the effect of generating various procompetitive

results,

including

lower

prices,

greater

access,

improvements

in

technology. Competition law proponents have specifically noted net neutrality to be limiting, inasmuch as it expressly prohibits any data discrimination, even though it may be a technically efficient approach.13 Contrary to the adoption of strict net neutrality principles which recommend an ex ante prohibition of all deviations, competition law contemplates a framework to assess different agreements in terms of their potential efficiencies and potential harms to customers and the market.14 Thus, under competition laws, agreements that seemingly deviate from net neutrality would be afforded an ex post assessment, based on the tangible effects likely to follow them. Interestingly, net neutrality opponents argue that that the Internet has not evolved as a neutral market place,and the imposition of rigid neutrality would constrain and hamper its growth. It would be safe to say issues relating to the market structure and market practices intrinsically belong in the domain of the competition regulator, and at the very least, merit a detailed discussion on the issue of its jurisdiction in the matter. The very nascent net neutrality regime in India, with no set regulations in place as yet, leaves a lot of ambiguities as to what is and isn't permissible in the transmission of data through the Internet. The (in)famous Airtel Zero plan has brought attention to the issue of discrimination favouring certain traffic, while the Internet.org scheme17 has brought to the fore issues of providing access to limited content, thereby blocking certain content. While both 16

Jahnavi Mitra. Moving Towards An Effective Net Neutrality Regime In India. At http://www.mondaq.com/india/x/416062/IT+internet/Moving+Towards+An+Effective+Net+Neutrality+Regime +In+India 17

Competition Commission of India awaits TRAI's stand on net neutrality, 21 July 2015 http://economictimes.indiatimes.com/industry/telecom/competition-commission-of-india-awaits-traisstand-on-net-neutrality/articleshow/48151349.cms

issues have been addressed by the TRAI and the DOT, even if not comprehensively, there is still a lack of clarity on the parameters within which to assess such agreements. Further, there is no deliberation on the Commission's jurisdiction to consider these issues. Moreover, Mr. M.S. Sahoo, a Member at the Commission, has recently stated that the issue of net neutrality is 'not yet on the Commission's radar', and it is 'awaiting the TRAI's decision in this regard'. 18 The TRAI Paper, which invited public comments for a regime for internet regulation, has engendered high levels of skepticism for closely following Airtel's controversial proposal to charge higher data usage rates for the use of Voice over Internet Protocol (VoIP) services.19 The TRAI Paper has largely been perceived to favour the practice of discriminatory transmission of content by telecom companies. As such, the TRAI Paper has merely raised questions on the possibility of data/price discrimination by ISPs without providing clarity on the manner of regulation. The DOT Report adopts a more concrete albeit conflated approach towards net neutrality, by calling for a 'flexible' policy involving an adoption of the 'core principles of net neutrality' while simultaneously excluding the prospect of actually defining 'net neutrality'.20 Replete

with

contradictions,

the

DOT

Report

entirely

rejects

the internet.org scheme (which is but a form of zero rating), while maintaining that the practice of zero-rating 21must be afforded by a case-by-case evaluation. The DOT Report confines its evaluation to the role of the TRAI in adjudicating the matter, without affording due consideration to the Commission as an appropriate authority to review the competitiveness of the agreements. The entire debate overlooks the fact that the crux of the issues being debated lies in different types of agreements executed between ISPs and content providers. Indeed, it may be argued that the entire debate can be reduced simply to the impact of these agreements on the markets in which the parties operate, and on the customers of the services offered by them. The Commission is likely to have a more nuanced perspective to this debate, through a

18

See Net Neutrality Not on Our Radar Yet, Says Competition Commission of India, 20 July 2015 http://gadgets.ndtv.com/internet/news/net-neutrality-not-on-our-radar-yet-says-competition-commissionof-india-717684; 19 Bharti Airtel withdraws controversial VoIP tariff plan, 30 December 2014, available at http://articles.economictimes.indiatimes.com/2014-12-30/news/57528969_1_voip-airtel-s-tariff-plan; 20 ; Sanjay Vijayakumar, Raising voice over net neutrality, The Hindu, 04 January 2015, available at http://www.thehindu.com/business/Industry/raising-voice-over-net-neutrality/article6751797.ece 21 DOT Report

comprehensive consideration of the market effects. Moreover, it appears to overlook the necessity of tailoring the net neutrality regime to suit the needs of the Indian market, such as the pressing urgency to improve internet penetration in India. An assessment accounting for these factors may lead to the conclusion that the internet need not necessarily be strictly 'neutral'. In India, the Commission is well-equipped to conduct this assessment in a wholesome manner. The Commission has the powers to effectively rule on the competitiveness of non neutral platforms such as internet.org and Airtel Zero on the basis of their actual and/or likely effects on the Indian market and consumers. Arguably, zerorating platforms such as internet.org, though ex facie rejected by DOT Report, maybe found to have some efficiencies and benefits in India upon an assessment of the operation of the vertical agreement. This evaluation would, however, call for the Commission to exercise its jurisdiction over the matter.

CONCLUSION The Internet is the most important telecommunications network of the last fifty years. Enabled by public protocols and standards, and by significant advances in electronics, computers, fiber optics, and laser technology, the Internet has been an engine for the growth of both the United States and world economies. Relying on public protocols, applications are developed to run across the Internet and content is disseminated on the Internet without the approval or consent of centralized Internet operators. Tremendous successes resulted such as the World Wide Web and all the applications that run on it, including big financial successes like Yahoo and Google, as well as big benefits of social interaction networks and great leaps in civil society through new discussion forums and formats. The Internet, in its commercial form, is a relatively new network, with only a dozen or so years to date. Its tremendous acceptance and success has made it an essential part of both business and personal life. All previous electronic networks, including early successes, like AOL, have abandoned proprietary formats and folded into the Internet. The success of the Internet thus far has been based on openness and non-discrimination, which until recently, was guaranteed by U.S. telecommunications regulation. Recently, the abolition of this regulation has led to proposals by broadband Internet access providers that would radically change pricing on the Internet. This article shows that these changes are likely to hurt consumers and diminish innovative activities in complementary sectors such as computer applications and content dissemination. These pricing proposals, if implemented, are likely to raise a variety of significant anti-competitive concerns, outlined in detail in the article. Among these concerns is the possibility that access providers will degrade and/or restrict capacity in traditional Internet access to force applications and content providers to use their new “premium” service. The possibility exists that this degradation and restriction of capacity will happen in a coordinated way, in a cartel-like fashion. This article demonstrates that, even in the absence of such discrimination, due to the existence of network effects, charging a fee to application and content providers is likely to both hurt consumers and to reduce the benefit that the Internet brings to society as a whole. In addition, there are a large number of vertical anti-competitive concerns created by the absence of a non-discrimination policy. Access networks, if left unrestrained by nondiscrimination rules, have incentives to favor their own services, applications, and content and to kill competing services, such as independent VOIP providers, which provide alternative

telephone services over the Internet. Additionally, the access networks have incentives to leverage their access monopoly or duopoly market power in many other complementary markets by offering “take it or leave it” contracts. Thus, the access providers will be able to determine who will be the primary provider of search engines, content, and other applications and services. This would be highly detrimental to the consumers and industries that rely on the Internet.22 The present question before Congress is whether to allow the Internet to be run without non-discrimination rules or whether to impose specific non-discrimination rules. A number of considerations favor imposing a specific rule supporting “net neutrality.” First, litigation is very slow, and much damage can be done before the resolution of litigation establishes a clear rule. Second, there are a number of different antitrust concerns, and litigation will have to deal with each one at a time. Third, although the Internet is a crucial network supporting United States’ economic growth, Internet penetration in the United States is low compared to many other countries with much lower per capita income. The imposition of discrimination is likely to amplify these problems. Fourth, because of network effects, the correct public policy is to subsidize the Internet, rather than increase its price. The price discrimination schemes discussed are likely to effectively increase the price consumers pay for Internet access. Finally, the innovation “at the edge” of the network that has flourished under the regime of “net neutrality” would be significantly threatened by discriminatory actions.

22

https://www.ijsr.net/archive/v4i12/NOV151590.pdf

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